Star Entertainment Group’s shareholders have savaged the company’s leadership with almost 30 per cent voting down its proposed remuneration report after a “disastrous” year.
One angry shareholder exclaimed “shame, shame, shame” at the group’s lengthy annual meeting on Tuesday despite contrite opening addresses from chairman Ben Heap and newly minted chief executive Robbie Cooke that confronted the group’s battered reputation head on.
The Star’s shareholders have savaged the group’s board at Tuesday’s annual general meeting. Credit:Flavio Brancaleone
Two independent inquiries in NSW and QLD found the embattled group unfit to hold casino licences following a 2021 investigation by this masthead which found it had enabled extensive alleged criminal activity. The findings showed The Star had a deep-rooted cultural problem that developed due to poor governance, leading to 29.75 per cent of proxy votes rejecting the group’s remuneration plan.
Chairman Ben Heap did not protest against the strike but said the company “takes the views of shareholders extremely seriously and will seek to do so over the next 12 months”.
Heap issued a mea culpa to shareholders last month, pleading for a chance to demonstrate the casino giant could turn over a new leaf and implement a complete cultural overhaul. Since the findings, The Star has replaced its chairman and chief executive as well as a number of board members. About 20 executives have left the group since former chief executive Matt Bekier resigned in March.
Cooke formally took the reins last month, on the same day the NSW regulator stripped the group’s Sydney casino licence, implemented independent manager Nicholas Weeks and imposed a record $100 million fine.
All other items were supported by shareholders, with some commending Heap and Cooke’s leadership and others lamenting The Star’s dwindling share price and damaged reputation.
“What a disastrous year it was for our great company. We lost half of our board. We lost our chief executive. We lost most of our executive team… As if it wasn’t enough to lose our leadership but we also lost most of our VIPs,” one shareholder said, asking The Star’s board to explain why customers should not seek out rehabilitated rival Crown Resorts.
The revenue of Star’s flagship Sydney casino has collapsed 11 per cent since July. Crown opened its long-awaited high-roller gambling room at its $2.2 billion Barangaroo casino on August 8. But The Star’s overall results were lifted by the Gold Coast premises where revenue was up more than 30 per cent on pre-COVID-19 levels while Brisbane grew by 9 per cent.
Cooke said the Queen’s Wharf Brisbane casino was still on-track to open in the second half of next year, with the group’s total project costs expected to increase by about 10 per cent on its previous guidance of $2.6 billion.
The group expects the cost of remediation to range from $35 million to $45 million this financial year, with roughly half to continue after the 2024 financial year. It did not provide any guidance as to when it will resume paying dividends.
The Star is facing two securities class actions headed by Maurice Blackburn and Slater and Gordon on behalf of shareholders in Victoria. Both claims allege the company made misleading representations – including about its systems and processes for compliance with anti-money laundering and counterterrorism financing obligations – that it failed to disclose relevant information about those matters to the market, and that it conducted its affairs contrary to the interests of The Star’s members from March 29, 2016, to March 16, 2022.
The Star’s share price fell two per cent to $2.86 on Tuesday afternoon.
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